Managing Duplicate Payments: Everything You Need to Know


With the US in recession and the EU to follow, companies face big challenges to maintain profitability and position within their markets. In such difficult economic climates, every pound invested should be spent with this in mind.

How can Accounts Payables contribute to company profitability?

Data from APQC in 2020 shows that on average 1.5-2% of annual disbursements are duplicate or erroneous payments. This affects even top performing companies with 0.8% of spend being duplicated. During the pandemic, the situation worsened, where 16% of financial managers identified duplicate payments as the top payment challenge.

With enough awareness, however, and the desire to act, these problems can be resolved. Here we explain how duplicate payments happen and how you can prevent them.

What are Duplicate Payments?

A duplicate payment is an additional payment that a company pays to a vendor for the same purchase of goods or services. The basic way to mitigate this issue is to have operating procedures that clearly define the procurement process and identify each team’s responsibility.

When it comes to payments, it’s essential to ensure that the purchase order, receipt, and invoice always match.

Best Way to Check Duplicate Payments

Several activities that are easy to implement can reduce the risk of duplicate payments.

  • Consolidate and validate. The very first step is to ensure that you have accurate information for each vendor. Make sure that when setting up a new vendor, you collect all payment details and update them regularly.
  • Deactivate duplicate vendors. If one vendor exists in your system more than once, this is a high risk of duplicate payments, or even, fraudulent activity. Also, if you haven’t purchased and paid a vendor for more than a year, it indicates that this vendor should be deactivated or removed. These are some of the reasons for regularly checking and updating vendor lists and data, at least once a year, and removing double entries or inactive vendors if identified.
  • Data entry standardisation. Although it sounds logical, be sure not to improvise while entering data in a non-consistent way. For example, the vendor’s name should be used exactly as it is, without any personalisation. To ensure consistency, create or use available forms that contain all required payment info, send them to the vendor, and have them fill in the gaps.
  • Tax information verification. Once you receive a filled form from the vendor, you are responsible for checking the accuracy of the entered data. Check all the tax info with the national tax institution at hand to ensure accuracy and smoothness in the tax return process.
  • Update payment data when changed. For different reasons, some companies change their company name, ownership, accounts etc. If you know such a change happened, ask the vendor to provide you with the latest information. This should be the vendors task, so make sure that data update responsibility is part of the agreement.

Secure Your Business from Duplicate Payments

No matter if the mistake made is driven by people or automated systems, Xelix is here to help you reduce bad practices, accurately automate your processes and prevent duplicate payments from happening. Our platform will flag any deviation and identify a huge range of discrete duplicate invoice postings, automatically and at scale.

Prevent overpayments, minimise false positives, and manage duplicate payments like a pro – reach out to our professionals for more assistance! Book in a demo to see how.

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